Bankers granted around 100 million euros in funding to townhalls and to county councils in the first three months of 2011,nearly six times more than in the corresponding period of lastyear, according to data from the Finance Ministry.
The amount represents the money drawn by the local authoritiesin the first quarter based on permits from the Finance Ministry,which include the instalments of the loans taken out previously.Town halls cannot borrow just any amount from the banks, they needto keep within a maximum cap approved by the Finance Ministry inorder to limit the budget deficit.
"If the borrowed amounts increased, it means the localauthorities are making more investments. The loans are granted forspecific infrastructure projects and are guaranteed by the townhalls with their own revenues," commented financial analyst DragoşCabat.
The biggest amount of funding, over 54 million euros, wasgranted in February, and includes a foreign loan worth 10 millioneuros. The loan was granted by Austrian bank HYPO Niederoesterreichto the Oradea town hall for utility infrastructure works for theEurobusiness industrial park.
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